NSX Reports $1.6M Convertible Loan, Cuts Costs, and Adds New Listing
NSX Limited reports a $1.6 million cash injection from ISXFEU, completes the ClearPay joint venture sale, and reduces operational costs in its 2Q25 activities report, while facing delays in share issuance approval.
- Received $1.6 million convertible loan funding from ISXFEU
- Delay in issuing shares to ISXFEU due to ASIC review
- Completed sale of ClearPay joint venture, closing $500,000 convertible loan
- Operational costs and staff payments decreased significantly
- National Stock Exchange of Australia added one new issuer and adviser
Funding Boost and Share Issuance Delay
NSX Limited (ASX:NSX) has reported a notable $1.6 million cash injection from ISXFEU via a highly conditional convertible loan, strengthening its balance sheet as of early 2025. However, the company continues to face delays in issuing shares to ISXFEU, with the Australian Securities and Investments Commission (ASIC) still reviewing an application to vary ISXFEU's control from 30.345% to 41.5%. This regulatory scrutiny has postponed the previously approved issuance of up to 88 million shares intended to close a $2.2 million convertible note.
ClearPay Sale Completes, Improving Liquidity
In December 2024, NSX finalized the sale of its ClearPay joint venture, a move approved by shareholders at the November AGM. This transaction enabled the company to close a $500,000 convertible loan, providing additional liquidity and allowing NSX to focus on its core exchange operations. The divestment marks a strategic shift as NSX streamlines its business and prepares for further capital raising initiatives.
Operational Efficiency and Cost Reductions
The quarterly report highlights a significant reduction in cash payments for administration and staff costs, dropping by $670,000 and $233,000 respectively compared to the previous quarter. The decrease is attributed to the absence of one-off termination payments and prepaid fees that inflated costs in the September quarter. Despite these savings, the company recorded a net cash outflow from operating activities of $686,000, reflecting ongoing investment in its business.
National Stock Exchange of Australia Activity
NSX's wholly owned subsidiary, the National Stock Exchange of Australia (NSXA), maintained steady progress with one new issuer commencing trading and the approval of a new Nominated Adviser. The pipeline for new listing applications is growing, indicating sustained interest in the exchange's offerings. NSXA continues to process applications and manage market operations amid a competitive landscape.
Middle East Project Delays Persist
The company’s joint venture project in Saudi Arabia faces ongoing delays due to regulatory reviews and geopolitical conditions in the Middle East. NSX reports minimal expenditure on this front while awaiting clarity from Saudi authorities on regulations and commercial terms. The cautious approach reflects the complex environment and the company's intent to conserve resources until progress is confirmed.
Looking Ahead: Capital Raises and Market Positioning
NSX is actively engaging with potential investors ahead of an anticipated placement and entitlement offer. The company expects support from new substantial shareholders, although any investment exceeding 20% will require regulatory and shareholder approvals. With cash reserves at $1.037 million (excluding restricted funds), NSX estimates it has just over one quarter of funding available at current operating cash burn rates, underscoring the importance of successful capital raising efforts.
Bottom Line?
NSX’s near-term outlook hinges on regulatory approvals and successful capital raises to sustain its operational momentum and growth ambitions.
Questions in the middle?
- What is the expected timeline for ASIC’s approval of ISXFEU’s increased control?
- How will the company deploy the new capital to drive growth and listings?
- What impact will ongoing Middle East delays have on NSX’s strategic partnerships?
